Teacher Salaries in Utah

Recently, the MSM has been beating the Utah-teachers-aren't-getting-paid-enough drum. Before taxpayers take the MSM's arguments hook, line, and sinker, they should look at some of the facts that the MSM doesn't want you to know.How do wages in Utah compare to other states?According to the 2006 Economic Report to the Governor (page 51), Utah average annual pay is about 81% of the national average. This is an average wage for all non-agricultural workers and is NOT a per capita wage (which would include non-wage earning children). According to the National Education Association's Rankings & Estimates (November 2006, page 19, chart C-12), Utah teachers on average earn 82.8% of the national average.Notice any similarities? It's no surprise that Utah teachers earn about 83% of what teachers nationally earn while Utah workers as whole earn about 81% of the national average (we've heard reports that the percentage for Utah workers has increased by a couple of percentage points). If Utah workers earned 100% of the national average, they would be paying more taxes which would allow the state and school districts to pay teachers what teachers in other states earn. In other words, Utah teachers make less than their counterparts in other states because Utah accountants, engineers, plumbers, and electricians make less than their counterparts in other states.But wait, there's more: benefitsUtah state and local government employees receive a very generous retirement benefit. Utah is one of a very small group of states where state and local government employees (including public school teachers) don't have to pay into the retirement system. With the exception of a small group of older employees, state/local government employee pensions are funded 100% by taxpayers.According the Census Bureau's Public Education Finances 2004 (March 2006, page 6), Utah taxpayers spent 37.44 cents on teacher benefits (including retirement) for every $1.00 of teacher salaries. The national average was $29.07 cents per $1.00 of teacher salaries.After adjusting for benefits, Utah teachers' total compensation is 88% of the national average. Can we close the gap?Even though Utah teachers, compared to their national counterparts, earn what Utah workers in general earn compared to their national counterparts and even though Utah teachers receive better benefits than their national counterparts, Utahns still have an opportunity to pay teachers more. We'll discuss this in a future post.

Posted by Utah Taxpayer on Monday, December 11, 2006 at 9:36 PM |Permalink

I think you're on track with your hint about how to pay more (merit pay or some kind of way to pay better teachers more than poor teachers). And your stats are correct in comparing against the nation. But what about the microcosm that is the intermountain states, where most other states around us have boosted teacher pay to exceed Utah and are drawing teachers away? (See Rolly's column). Don't we have to play in that game to get good new teachers or keep some of them that may be young, promising, and mobile? Maybe merit pay will be enough of a promise to keep them, but what do you say? Not really disagreeing with you here, but trying to spark some dialogue about what I see as an important consideration on this issue.

After the new GASB guidelines, retirement plans in many districts were cut--and this occurred after the data was collected in the report you cited. There have been some substantial changes since that time in many districts. (And state and county governments too.)

Also, when you say "teacher's salaries" are you using a mean or median? Either way, the number will be skewed higher than the middle point of the salary schedule, because we are lopsided with teachers near (or past) retirement.

The big hole in the "teachers are being paid enough" argument is that we can't attract and retain new teachers. Market forces are telling us the bottom of the pay scale needs fixing. (Yes, there are supply problems that need fixing too, but the issue is better addressed from more than one angle.)

1. Are you suggesting that the GASB changes impacted only Utah or that Utah was disproportionately impacted compared to other states? I suspect that is not the case, but if you have evidence that GASB didn't impact teachers in other states as much as it impacted Utah, I'd be happy to look at it.

2. The salary to benefits ratio for Utah teachers actually increased to 39.54% in 2005, according to data found in the USOE annual financial report, up from the 37.44% from Census Bureau data cited in our post. Btw, using the Census data and the USOE data for 2004 yield the same result of 37.44%

So while the changes you mentioned did not show up in either 2005 or 2004, 2005 was higher than 2004, at least in Utah.

3. The mean/median issue is not unique to Utah, and that applies not just to teacher salaries but to salaries of Utah workers in general. Again, if you have statistical evidence suggesting that using one over the other distorts Utah's situation, I'd be interested in seeing it.

We wouldn't dismiss the competition issue, but this is an issue that virtually all Utah employers deal with, not just school districts.

We all know accountants, engineers, lawyers, and other professionals that could make more in neighboring states, but they choose to live in Utah. Since they are earning less, they end up paying less in taxes (in absolute dollars, not a percent of income) which means there's less money to pay teachers and other government workers.

Rolly's column is what prompted us to write this post in the first place because we wanted taxpayers to know what Rolly wasn't telling them.

Merit or performance pay is needed, but differential pay is also needed. Teachers in high demand areas should get more than teachers in lower demand areas. Paying a dance teacher the same as a calculus teacher does not make a lot of economic sense, especially since economic development depends more on advanced math skills than dancing and since calculus teachers are generally harder to find than dance teachers. The unions don't like hearing this, but it is true.

I too, am not keen on a Socialist approach to teacher compensation but in the spirit of keeping taxpayers well informed, regarding your last post on taxes paid by all Utah workers, how does the budget surplus fit in with the statement, "Since they are earning less, they end up paying less in taxes (in absolute dollars, not a percent of income) which means there's less money to pay teachers and other government workers." for this year?

And how does this equate with our neighboring states, Nevada and Wyoming, which do not collect income taxes, and continue to lure our new educators away from Utah with better pay?

We should also acknowledge that the dance, art, P.E., and music, teachers may be the ones keeping students walking through the schools' doors which also has a positive economic effect by keeping kids from dropping out of school.

My comment refers to the fact that if a group of people (Utah workers in this case) make less than other people (the rest of the nation on average), then they won't be able to pay as much in taxes. The more you make, the more taxes you can pay. The more taxes you pay, the more the state can pay its teachers.

The surplus means that there is more money in Utah, but it does not mean that Utah workers have suddenly surpassed the national wage average, especially since other states are experiencing surpluses as well.

If we need to pay teachers more to stop them from going to Wyoming and Nevada (keep in mind that only so many Utah teachers can actually move to Wyoming since Wyoming is a very small state with about one-fifth the population of Utah), then pay them more based on performance and demand by subject (math, etc.)

Paying math and science teachers more doesn't imply that P.E. aren't important nor does it suggest that schools should no longer have P.E. classes. Districts nationwide have complained for decades that finding math, science, and special education teachers is more difficult than teachers in other areas. So, instead of speading pay increases evenly across the board, pay increases should be focused on those areas that are highest in demand. While P.E. classes have value, our long-term economic growth is more heavily dependent on math and science than P.E.

I'm suggesting the effects of the GASB decision will not be reflected in financial reporting until the 2006 numbers are released. Several contracts were renegotiated in 2005, prompting a significant number of retirements at the end of the 2005-2006 school year.

(Here's what I don't know: I don't know which way the numbers will turn, although I suspect the retirement benefit as a percentage of salary will decrease significantly. I also don't know the extent of health insurance costs increases on the salary/benefit ratio, and whether it will negate or overshadow changes in retirement benefits.)

I do know that whatever the averages salary comparisons say, our starting teachers are leaving the state. Salary is only part of it. The student/teacher ratio (i.e. daily work load) is a part of it too, as are a host of other factors (mentoring, administrative support, professional development, signing bonuses, etc.)

As for the median/mean issue--I'm suggesting that whichever you use, the number masks the salary disparity in the bottom quartile. (I would prefer to see any wage increase weighted to the bottom end of the salary schedule.)

I agree that we need differentiated pay--and I haven't seen much support for it from the UEA. Salary incentives for hard-to-staff subjects are essential. You're on target with that conclusion.

I want to thank you too, for being one of the few blogs that cites your research. (Could I get you to start hyperlinking it?)

The problem with the statistics in your article is that it does not factor in education. I would like to see how much the average Utahn makes with a bachelors or masters degree and compare that to how much teachers make with the same education. Teachers are more than "average workers." To become a teacher in the state of Utah one has to have at least a bachelors degree, take education classes approved by the state, and take Praxis testing to show that he or she is "highly qualified." This is more than the average worker has to do. Again, show me numbers that factor in education.

The comparison is not Utah workers with Utah teachers but rather the salary ratio of Utah workers to U.S. workers on one hand and Utah teachers and U.S. teachers on the other hand.

In fact, Utah teachers make more than the average Utah worker, as one would expect. According to the 2006 Economic Report to the Governor (page 56), Utah's average non-agricultural wage in 2004 was $2,642 per month, or $31,704 per year, which is less than the average Utah teacher. The average Utah teacher salary in 2004 was around $40,000.

To restate the bottom line: Utah teachers make less than their national counterparts just as Utah workers as a whole make less than their national counterparts. If Utah workers in general were paid the same as the national average, then they would pay more taxes which would allow government to spend more money, including more money for teacher compensation.

Are you suggesting that Utah teachers should be paid at the national average while Utah workers in general are paid less than the national average?

Our statistic does not address the issue of Utah teacher salary compared to the salary of other college-educated workers. That was never the point. That may be your point, which is fine. I don't think anyone doubts that teachers make less than doctors, lawyers, accountants or engineers.

However, if educators and others are going to argue that Utah teachers are paid less than the national average, they have to admit that Utahns in general are paid less than the national average, and the latter is the cause of the former.

Are all occupations that are funded by taxes paid 80% of the national average of their field? If we are going to make that comparison for teachers, then we need to make it for all publicly funded occupations.

I don't think that information is available (I've looked but haven't found it), although it would be interesting.

I disagree with your conclusion however. If data showed that non-education Utah government employees were paid 25% below the national average for non-education government employees, that would be no reason to pay teachers 25% below the national teacher average.

For the record, the Utah Taxpayers Association supports increased teacher pay but not the way the UEA demands. We'll have more on this very soon.

I just want to say thanks for responding to my comments so quickly. I actually came across this article while I was searching for something else, and I wanted to make some comments once I read it. I noticed it was written a while ago and I wasn’t sure if my comments would even get read. Again, I appreciate the prompt response.

The Wall Street Journal, 2-2-07, stated in an Op-Ed piece (Is $34.06 Per Hour "Underpaid'?) that, according to the Bureau Of Labor Statistics, the average teacher in the US gets paid $34.06 per hour. Teachers are paid by seniority and diplomas, not performance. Hence a failing system.

The statistical data used is persuasive but I want my children to have the best education posible and if you pay teachers 80-85% of what teacher make in other states that is what your children will get. I believe my children are worth giving 110%. I guess many of you don't feel the same way.

Interesting comments. If paying Utah teachers above the national average is necessary in order to get a good education for your children, the question remains how do private sector Utah companies manage to compete while paying their employees below the national average?